Balwin Properties has posted its annual financial statements for the year ended 28th February 2025, reporting a 6% decrease in revenue to R2.2 billion with an 8% increase in profit to R234 million.
The Group recognised 1 749 apartments (2024: 1 892) in revenue for the year. Revenue was supported by Balwin Annuity which experienced growth and increased revenue by 33% to R175.8 million (2024: R132.5 million), contributing 7.9% (2024: 5.6%) to total group revenue.
Balwin says its results represents a tale of two halves; with a “pleasing recovery in the second period but overall, reflect the sustained economic pressure on consumers, owing mainly to the prolonged high-interest rate environment and growing local and international political uncertainty.”
The Group recorded 62% of its annual revenue and 67% of its profit for the year in the second half of the period with the improved trading performance led by the 75-basis point reduction in the prime lending rate since September 2024 together with the initial positive sentiment that followed the formation of the Government of National Unity (GNU) in June 2024. The rate relief had a positive impact on the Group’s sales, with the monthly average gross sales rate increasing by approximately 30% since the start of the rate cutting cycle.
Group gross profit margin recovered to 30% (2024: 28%) due to the performance of the Balwin Annuity businesses with the gross profit margin from the sale of apartments consistent with the prior year at 24%. Balwin Annuity contributed R171.7 million (2024: R131 million) to the Group’s gross profit, supporting the margin.
The Group’s operating expenditure remained flat on the prior year at R350.9 million (2024: R351.2 million) with operating costs at a company level reducing by 6%. Balwin Annuity increased its operating costs by 14% to R114.2 million due to increased activity reflected by the 33% growth in revenue.
Balwin recorded a profit after taxation of R234 million, an increase of 8% over the prior financial year, closing the year with a cash balance of R254.8 million with cash resources exceeding the funding covenants and thresholds set by its Board.
The Group resolved not to declare a dividend for the 2025 financial year (2024: no dividend declared) with its primary focus to apply capital to reducing its debt exposure.
Balwin’s loan-to-value (LTV) ratio reduced marginally to 40.4% (2024: 40.5%).
